SINGAPORE: China is moving ahead with a deal to export nuclear reactors to Pakistan despite grave misgivings in the West, in a sign it too can shape the rules of global nuclear trade after the US forced a waiver for India.

By winking at India’s nuclear weapons programme and opening up exports of nuclear fuel and material to the rising Asian power, the US had created an opening for China and Pakistan to pursue similar cooperation, despite the risk of proliferation, analysts said.

Under the 2008 deal, the US lifted a 35-year embargo on nuclear trade with India and then leaned on the 46-member Nuclear Suppliers Group (NSG,) that lays the rules for peaceful use of nuclear exports, to grant an exemption so that a $150 billion market opened up.

China too is hoping to help meet the energy needs of Pakistan which was denied a similar deal by the US on the grounds that it had to improve its nuclear proliferation record first.

This week, as Chinese Premier Wen Jiabao travels to India first and then Pakistan, where he is expected to affirm strategic ties, the race to expand nuclear energy programmes in South Asia has added another layer of instability in a troubled region.

“The Chinese are proceeding with the export of the reactors, but they want to be prudent about it. They might want to look for some kind of support for it,” said Mark Hibbs, an expert on South Asian nuclear issues at the Carnegie Endowment for International Peace.

China plans to build two new reactors at Chashma in addition to the one already operating there and another nearing completion. Beijing says it is supplying the reactors to Pakistan under a 2003 bilateral agreement that it signed a year before it joined the NSG, and that its cooperation with Pakistan is purely for peaceful purposes.

“China and Pakistan will further develop their nuclear energy cooperation, and this is restricted to the civilian nuclear sphere, and conforms to the international duties assumed by both countries,” Liang Wentao, a deputy director general at the Ministry of Commerce, told reporters ahead of Wen’s trip. “It is entirely for peaceful purposes, and comes under the safeguards and oversight of the International Atomic Energy Agency.”

No consensus

China has not formally approached the NSG to grant Pakistan a waiver in the same way the US, helped by Britain, France and Russia, sought one for India, and it may well argue that it does not need to win NSG clearance since the additional nuclear reactors were “grandfathered” before it became a member.

But Hibbs said the US and some other members have indicated that while China informed the NSG about its nuclear collaboration with Pakistan at the time of joining the cartel, including that it was building two reactors, it did not mention plans to build reactors 3 and 4.

At the last NSG meeting in New Zealand this year, Ireland raised the issue of new Chinese reactors for Pakistan, but China declined to comment. The next meeting is in June, but it is unclear what stand the group will take. “There is as yet no consensus in the NSG how to deal with this,” said Hibbs.

The group could either accept China’s assertion that the reactors were part of an ongoing project before it joined the group, or it could formally protest the sale of the additional reactors as a violation of its guidelines, or simply ignore it.

The bottom line is that both China and Pakistan see an opening for greater nuclear collaboration after the India-US deal pushed by the Bush administration that many saw as turning the rules of nuclear non-proliferation upside down.

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Reader Comments (15)

If it is only for power generation i as an indian have no problem at all… But it is a big if. The only problem is as long as china gets the money for this, I dont think it will care to check nuclear proliferation. The western nuclear provider on the other hand are paranoid about subcontinental proliferation, and has effective measures to check proliferation in India.Recommend

–> It is. This is a nation which is heavily dependent on aid and loans which come from the West and NATO. The only reason why the west is giving money is because of Afghan War. After that there is no reason why it should give money for Pakistan, which has double crossed it many times in the past 10 years. This dissatisfaction is apparent when you read the recent Wikileaks.

North Korea is a nation which has no money and is dependent on China for economic Survival, just like Pakistan is going to be after NATO pulls out of Afghanistan.

“India may not be Africa but it is worse than Africa in many fields.”

–> If you talking about the number of poor, let me remind you that we are the 2nd largest population in the World and consequently the number of poor tend to be more.

But, if you talk about percentages, Pakistan is the clear winner, suggests this World Bank Statistics.

message is for ANOOP
what do u mean by referring— you are talking economics–coming from Pakistan?
do u know hat he land which is now pakistan has the river INDUS–which comes from Sindhu and hence INDIA–essentially a river in Pakistan gives the name to the whole nation of India
yes–intelligent people live here for 7000 yrs–same gene pool–buddy
so dont be so look down the nose
Pakistan takes a back seat to no one—
problems?–look in your own backyard– there are insurgencies in 20 states of the Indian union? and a brutal army of 700,000 in occupied Kashmir– let them go u bullies!!–they dont want uRecommend

I merely suggested that India has a much more vibrant, stronger and enormous Economy compared to Pakistan’s and is best suited to tackle poverty as Pakistan constantly live in this utopia that somehow India is poorer than Pakistan, defying the rules of Economics.Recommend

@Anoop
How manY times I told you that your sample drawing is erroneous. You can not compare a country that of size of India and 8 time smaller nation Pakistan? Why you come here and compare. We have no comparasion due to size imparity. Go and draw a sample from the equal neighbor of your size, China. That will be equal sample comparasion. I know why you run away from doing that. reason is simple.. The Moment you will put these two countries together whether it is GDP, Employement, Poverty, Education You will immediately fall into the state of inferiority complex. Rule is that you compare apples with apples Water melon with Water melon … Your data has no value against pakistan. Two are way off in size. Go do it with China. You will know where You stand on Poverty.Recommend

@Anoop: Was just browsing through the news when I saw your economics. I need a re-run on all my courses after hearing your “authoritative” views on the subject.

Okay, first question. Have you been to Pakistan? (In response to your counter question, yes i’ve been to India.) If no, then its safe to assume you rely on news and conjecture in lambasting Pakistan. No genius, we do not rely on aid and loans. The recent string of aid news you hear is all after the most devastating floods in the history of the country that covered 20% of land with water. Given the seriousness of the situation, there is an obvious need for aid (The US even suffered in trying to contain Hurricane Katrina’s damages, a much smaller catastrophe). Regarding the loans, they are for developmental purposes and they are not the reason Pakistan is afloat. It is a vibrant economy with eggheaded leadership. Anybody who has been in the Pakistani insustries knows that. I know that having been involved first hand with India’s industry. I know the country’s infrastructure (in comparison with India) and know where it’s better. I know where regulation here is better. I know where comparative cost advantages here are better. Its political risk that’s killing Pakistan along with lack of guiding leadership.

Finally, we are dependent on China for survival? Please explain that economic genius? We get aid from them? Massive grants? What? Yes Pakistan has undertaken projects with China. They were for mutual benefit, if they weren’t, you can bet your economics degree China wouldn’t have been here. You reinforce the point that India has a healthy degree of charlatans who dont know squat and surf the net trying to advertise the country’s greatness. Yes, your economic progress is great and deservedly so maybe. But there are more chinks in the armor than is realized by the mainstream and a trip to India by anyone usually reveals that. For one, you are too dependent on a growth dependent model which is relied on to continuously fund yourself out of a high debt-GDP ratio. Once that growth subsides, there are going to be problems. Indian business giants are realizing that and diversifying themselves through installations in Africa. Get real Mr. Economist!Recommend

@Rajat: May I just say your point does not make any sense. Pakistan already has nuclear weapons. We created them after India did and that was a right to self defense, given how Indian politicians had taken up the rhetoric against Pakistan after their successful nuclear tests. Pakistan right now has a crippling energy shortage and oil and gas obviously can not be relied on all the time. Hence, nuclear energy. What’s more, the US pushed the nuclear suppliers group to approve its sales to India based on nothing but Economic reasons. China is doing the same now and following the US’s lead. India does not have any extra controls on its nuclear installations, neither Pakistan or India have signed the treaties. Hence, your questioning of Pakistan’s motives does not make the slightest sense to me.Recommend

@Anoop: Wikileaks also points out many other things genius, including India’s gross legalization of human rights abuses in Kashmir and torture methods that defy a sense of humanity….ranging from putting iron bars on thighs to break them to beating people to a pulp. What’s more, this comes on the back of claims by the Indian government that insurgency in the region is at an all time low. Way to go! The International Court of Justice should really take this up.Recommend

–> I used the words ‘heavily dependent’. It might look like I suggested Pakistan might come apart without aid but what I meant was not that extreme.

Here, is what BBC says about it: “With 28% of the budget being reserved this year for servicing Pakistan’s huge external debt of $54bn, nearly 60% of the budget is taken up by just two items – defence spending and debt servicing. ”

Not all aid is for non-military purposes. Here, is an instance of what US does for Pakistan military, which again lessens the burden on Pakistani economy. About 15 to 20 Billion dollar has been given, which is unaccounted for, to the Military.

Now, onto India. India has a lot of problems, including Infrastructure problems. But, it is working on it. In 3-5 years it will become the fastest growing economy in the world and the kind of social and economic transformation which took place in China during the 1990s will happen in India.

“Once that growth subsides”

–> There are no signs of that happening anytime soon is there.

Goldman Sachs says India will be the 2nd or the 3rd largest economy by 2050. That cannot happen if the growth number comes down, will it. I will trust a institution like Goldman Sachs than anyone person.Recommend

So, dont you think your energies will be better utilized by fixing the Massive Human Rights abuse in the entire country rather than concentrate on a tiny part of India?

But, I will take up the Kashmir Issue. The Human Rights abuse which happened there is very sad and condemnable. But, the good thing is people live in a Democratic Society and they will decide their own fate, ultimately, through vote.

Also, if you are so concerned about Human Rights, why dont Pakistanis talk about such abuse in Xinjiang in China? India is after all an open society and as a result most of the abuse comes to light in one way or the other. No one speaks about the abuse suffered by Uighur Muslims. I have a lingering doubt that it has something to do with Pakistan’s close ally and the need to please it. Why this hypocrisy?

Even better you can devote your energy in bringing the people responsible for 1971 genocide in Bangladesh who are still roaming free in Pakistan as mentioned in the Hamoodar Rehman Commission report.Recommend